Our Thinking

Five Ways To Bring The Intensity Of Black Friday To Everyday Retail Promotions

Forecasts for Black Friday 2017 suggests that Thanksgiving 2017 will be a bumper year for both online and offline retailers. Online coupon provider RetailMeNot forecasts that the average US shopper will spend approximately $743 over the holiday weekend, and revenue will be up 47% for the holiday compared to last year. But just what exactly motivates Black Friday Shoppers? – And, more importantly, how can retailers incorporate those drivers into more mundane weekly promotions? There are a number of psychological reasons why shoppers gravitate to spending over the holiday weekend.

Habit and Social Influence

Black Friday and Thanksgiving retail promotions are a key part of the Thanksgiving experience for many families. Thanksgiving sales are a key part of family time shared over the holiday weekend, from lining up for a special deal on a new Xbox, television or other device used by the whole family. In addition, lining up overnight for a new technological treat, like the launch of the iPhone X, creates bonding through shared experiences. Thus, something that in normal circumstances would create friction or irritation instead becomes a positive emotional experience that creates memories for shoppers.

Retailers have many ways to create shopping driven habits – for example the habitual look through weekly ads or flyers before shoppers make a trip to a grocery store. In addition to circulars, retailers can create habitual experiences through the use of consistent promotions or day themed events in store, like our client Longo’s hot meal promotions, which give families the opportunity to experience a ready-prepared family meal that is nutritious and convenient for families’ busy lifestyles.

Gamification

Gamification is the incorporation of typical elements of game playing – point scoring, competition with others, and the completion of tasks for rewards – into marketing activities. Gamification is frequently used in digital channels and programs to build engagement.

On Black Friday, shoppers are encouraged to ‘treasure hunt’ for the best deals, to shop early to ensure that they don’t miss out on the best deals, and to seek out information in order to receive the reward of a great deal. Shoppers gain status by making smart savings and by saving more than their friends and family or other shoppers.

For regular promotions, Gamification can be used as a tactic by offering rewards such as: bonus loyalty currency for buying complementary products; additional useful information (like styling tips for the best shoppers at an apparel store); or prizes that relate to status in loyalty programs (like Sephora’s use of free makeup consultations for high tier loyalty program members).

Sense of Urgency

Retailers have long created urgency in Black Friday events through a number of mechanics – the fact that Black Friday is one day a year, and the availability of special deals on a limited number of items that reward the first shoppers arriving at the store (or the store’s ecommerce site on Cyber Monday). The urgency of these deals creates anticipation for shoppers, as well as the fear of missing out on an opportunity.

Outside of Thanksgiving weekend, retailers can create the sense of urgency by offering limited-time/limited-volume promotions. These can be used to drive both on and offline traffic and increase average transaction values. Limited-time promotions can also be used to help improve revenue performance for specific departments, and Customer Relationship Management (CRM) communications can be used to reward loyal shoppers responding to promotions that have a finite time window. Hudson’s Bay Department Store uses these promotion types to drive traffic both on and offline.

Costco and Winners use limited-volume promotions to drive a sense of urgency about purchasing in order to ensure that shoppers can get a deal before it’s gone forever.

Anticipation

In the run-up to Black Friday, retailers provide previews of deals and offers. These teasers help build anticipation of the rewards that shoppers will receive at the forthcoming sales. They create emotional engagement by building excitement around the event, and trigger mental reward structures that encourage shoppers to invest further time and energy into the prospect of shopping over the holiday. Outside of Black Friday, retailers can create anticipation through the development of personalized rewards with game mechanics – for example the use of scratch and save promotions where shoppers do not immediately know the value of a promotion.

These mechanics do not necessarily require price promotion mechanisms; they can also be used in the context of other promotions – for example competitions and other promotions that offer additional benefits like free style consultations for apparel retailers, or interior designer consultations for homeware stores.

Anticipation is a key mechanic of promotions like the Tim Horton’s annual ‘Roll up the Rim’ contest or McDonald’s long-running Monopoly promotion.

Introducing Competition

Every Black Friday brings with it elements of competitiveness – from being the first shopper to enter a store on Black Friday, through to the annual news reports of conflict in stores over limited-volume offers. The emotional intensity of these promotions can lead to physical conflict as a result of deep shopper engagement with Black Friday sales. While conflict is less than ideal, building competiveness among shoppers can create deeper engagement, enable stronger brand relationships, and set off a shopper journey of discovery with the brand.

LevelUp is a shopping app that enables users to level up to better deals, once they have accessed and participated in a promotion. Each completed promotion enables access to a better offer, and is designed to build frequency of use. LevelUp is used by foodservice chains to build frequency of usage and inspire both loyalty and experimentation, especially for lunch and breakfast, which tend to be highly habitual usage occasions.

Competitiveness is introduced through the use of mechanics like league tables, where shoppers can compare their performance to other subscribers and to their friendship groups within the application ecosystem.

Looking at shopping behaviour over the emotionally intense Thanksgiving holiday enables us to identify opportunities to develop more emotionally engaging shopper promotions that not only satisfy shoppers’ rational needs – seeking the best value products – but also engage shopper emotions, and thereby create deeper engagement with retail brands.